Post Holdings Inc., the branded cereal business unit of Ralcorp Holdings, will be spun off as a separate publicly traded company after markets close Friday. The spinoff was announced last July.

After the close of trading Friday, Post will replace Comstock Resources Inc. in the S&P MidCap 400 index.

Post’s brands include Honey Bunches of Oats, Grape Nuts, Raisin Bran and Pebbles cereals. Post Holdings is based at 2503 South Hanley Road in Brentwood.

Once the separation is completed, Post will trade Monday on the New York Stock Exchange under the “POST” ticker symbol. Bill Stiritz, chairman of Ralcorp, has been named Post’s new chairman and CEO. J. Patrick Mulcahy, Ralcorp’s vice chairman, will serve as chairman of the board at Ralcorp after the spinoff finalizes.

In filings with the U.S. Securities and Exchange Commission, Post signaled it will make changes to its marketing and pricing to grow sales and regain market share. Post’s market share in ready-to-eat cereals dropped from 14 percent in 2008 to 12 percent last year, according to a research note issued this week by Alexia Howard, an analyst at Sanford C. Bernstein & Co.

St. Louis-based Ralcorp Ralcorp Holdings acquired the Post cereals business from Kraft Foods in 2008 for $2.6 billion. Ralcorp is spinning off Post to concentrate on its private-label cereals, pasta and other baked goods. After the spinoff, Ralcorp will retain up to a 20 percent ownership stake in Post.

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A recent run of solid U.S. economic news has reinforced hopes that Friday’s nonfarm payrolls data will provide further evidence that the world’s largest economy is over its soft patch from last summer.

The consensus in the markets is that the U.S. economy generated around 170,000 jobs during January. Though that is unspectacular for an economy recovering from its worst recession since World War II, the amount of jobs being created is up from levels seen just a few months ago.

The pick-up in the U.S. economic data, in general, has also helped support market sentiment at a time when there is a huge amount of uncertainty relating to Europe’s debt crisis, despite more successful bond auctions Thursday from France and Spain.

“The fact that the U.S. is growing has been another source of relief,” said Jane Foley, an analyst at Rabobank International. “A disappointing number tomorrow could spark a retrenchment in appetite for risk.”

Weekly jobless claims figures later will be watched in the context of Friday’s report for the month of January.

Ahead of that, markets were subdued, though a raft of earnings in Europe have helped maintain trading activity, as has confirmation that mining company Xstrata PLC is in merger discussions with commodities trader Glencore International PLC. A deal would create a company with revenues of around $175 billion and the news has helped both share prices rally in London.

Despite the Xstrata and Glencore’s gains _ of 10 percent and 5 percent _ Britain’s FTSE 100 index of leading shares was down 0.2 percent at 5,781. Germany’s DAX was 0.1 percent higher at 6,623 and the CAC-40 in France was flat at 3,366.

The euro was also subdued after recent gains, trading 0.2 percent lower at $1.3146.

Wall Street was poised for a flat opening, too _ Dow futures were up 0.1 percent at 12,662 while the broader Standard & Poor’s 500 futures were flat at 1,320.

The focus on the U.S. over the rest of the week will have proved a welcome diversion for some traders from monitoring the daily grind of Europe’s debt crisis, where much hinges on whether Greece can secure a deal with its private creditors, as is anticipated.

A deal is expected in a matter of days, according to officials, though that has been the official line for a few weeks.

“Given that it’s Groundhog Day today its particularly apt that Greece continues to be the centre of continued speculation about what’s happening with respect to the debt talks and the latest bailout,” said Michael Hewson, markets analyst at CMC Markets.

“Even so markets are now so bored with it, any comments by EU officials are now being dismissed with a perfunctory shrug and an ‘I’ll believe it when I see it’ attitude,” Hewson added.

Earlier in Asia, Tokyo’s Nikkei 225 rose 0.8 percent to 8,876.82 while Hong Kong’s Hang Seng shot up 2 percent to 20,739.45 and Seoul’s Kospi added 1.3 percent to 1,984.30.

China’s benchmark Shanghai Composite Index climbed 2 percent to 2,312.56 on Thursday amid signs manufacturing improved in January for a second straight month.

Oil prices were subdued alongside other markets _ benchmark oil for March delivery fell 51 cents to $97.10 per barrel Thursday in electronic trading on the New York Mercantile Exchange.

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Lilly lost U.S. patent protection in October for Zyprexa, an antipsychotic that generated 19 percent of its third-quarter revenue. Revenue from the drug fell 44 percent to $749.6 million in the fourth quarter.

The Indianapolis company said Tuesday it earned $858.2 million, or 77 cents per share, in the three months that ended Dec. 31. That’s down from the $1.17 billion, or $1.05 per share, Lilly earned in the final quarter of 2010.

Revenue fell 2 percent to $6.05 billion.

Adjusted earnings, which exclude some one-time charges, were 87 cents per share.

Analyst surveyed by FacSet expected, on average, adjusted earnings of 81 cents per share on $5.89 billion in revenue.

Zyprexa is Lilly’s all-time best seller, and it topped $5 billion in worldwide revenue last year. The company still has patent protection for Zyprexa in Japan, but it expects revenue from the drug to plunge by more than $3 billion this year.

Lilly also was hurt in the quarter by a 62 percent drop in sales for the cancer treatment Gemzar, which lost its patent protection in 2010.

Revenue from Lilly’s second-best seller, the antidepressant Cymbalta, climbed 20 percent to $1.18 billion in the quarter. Revenue from its top-selling insulin, Humalog, rose 21 percent to $662 million small personal loans. The patents for both those products expire next year.

Lilly has spent years preparing for the patent losses. The company said it has cut more than $1 billion in costs since 2009 and trimmed more than 5,500 positions from its workforce.

It plans to depend on its pipeline of drugs under development, its animal health business, and sales in Japan and emerging markets like China to get through the expected revenue slump caused by the patent expirations.

The drugmaker said earlier this month it now has a dozen potential drugs in late-stage clinical testing, the last phase before a company seeks regulatory approval. The company expects annual earnings of at least $3 billion on revenue of at least $20 billion through 2014.

Some analysts doubt Lilly’s ability to recover from the patent expirations without the aid of a major acquisition, and they wonder about the future of Lilly’s dividend, which currently stands at a quarterly rate of 49 cents per share. Company officials have said repeatedly they expect to at least maintain their dividend and they plan no major deals.

Lilly said earlier this month it expects to earn between $3.10 and $3.20 in 2012. Analysts expect earnings of $3.21 per share.

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Small businesses added 50,000 jobs, payrolls processing firm Intuit said, compared with a gain of 60,000 in December. Still, labor market conditions continue to improve.

“Overall the small business labor market is not weak, but not strong either,” said Susan Woodward, the economist who developed the survey. “Small business employment continues to rise but at a rate that will not get us back to full employment very quickly.”

The government’s more comprehensive employment report due on Friday is expected to show nonfarm payrolls increased 150,000 in January, according to a Reuters survey, after rising 200,000 the prior month.

The unemployment rate is seen steady at a near three-year low of 8.5 percent.

The Intuit survey is based on responses from about 72,000 small businesses with fewer than 20 employees that use the Intuit Online Payroll system. It covered the period from December 24 to January 23.

The average monthly salary for small business employees fell 0.1 percent, or $3, to $2,632 in January. The average workweek eased 0.1 percent to 24.8 hours.

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]]> http://financeintime.com/summers-developing-nations-should-educate-girls-bloomberg/feed/ http://financeintime.com/bernanke-makes-case-for-more-bond-buying-bloomberg/ http://financeintime.com/bernanke-makes-case-for-more-bond-buying-bloomberg/#comments Thu, 26 Jan 2012 21:12:01 +0000 FinanceExpert http://financeintime.com/bernanke-makes-case-for-more-bond-buying-bloomberg/ Ben S. Bernanke laid the groundwork for a third round of large-scale asset purchases should unemployment remain higher than the Federal Reserve would like while inflation falls below a newly-established target.

The Federal Open Market Committee

Government data released Wednesday said the value of Japan’s exports fell 2.7 percent to 65.55 trillion yen ($843 billion) for 2011. The drop was attributed to the economic impact of the March 11, 2011 earthquake and tsunami and the rise in the value of the yen against the U.S. dollar, along with a gloomier outlook in the global economy.

In December, the trade balance was a deficit of 205.1 billion yen, according to the Finance Ministry figures.

The data underscore the growing pressures facing the world’s third-largest economy, which relies heavily on exports to drive growth. A persistently strong yen, Europe’s debt problems and the recent flooding in Thailand are eroding gains made since the March earthquake in Japan disrupted manufacturing.

The turmoil in Europe and the U.S. has driven up the yen as global investors flock to the currency as a relatively safe haven. The yen hit multiple historic highs against the dollar this year.

A rising yen shrinks the value of overseas earnings when repatriated and makes Japanese products less competitive in overseas markets. The yen has weakened to around 77 to the dollar recently, but exporters say it is still too high.

The currency levels have forced manufacturers including Nissan Motor Co. and Panasonic Corp. to shift some production overseas, a trend that could further undermine Japan’s exports.

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The drug, Gilenya, was licensed last year in the European Union to treat patients with a severe type of multiple sclerosis.

The deaths raise concerns Gilenya could trigger heart problems after patients take their first dose, according to a statement issued Friday by the European Medicines Agency. The agency said it isn’t clear whether the deaths were caused by the drug or not no fax payday loan.

More than 30,000 patients have taken Gilenya worldwide. The European Medicines Agency advised doctors to increase their monitoring of patients after the first dose of the medicine.

It hopes to finish its review of the drug by March.

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Mortgage rates go even lower • The average rate on the 30-year fixed mortgage fell again this week, but the eighth record low in a year is attracting few takers because most who can afford to buy or refinance already have. Mortgage buyer Freddie Mac said Thursday that the average rate on the 30-year fixed mortgage dipped to 3.88 percent this week, down from the previous record of 3.89 percent last week. The average on the 15-year fixed mortgage ticked up to 3.17 percent from 3.16 percent, which was also a record low.

GM back on top • General Motors Co. has retaken the title of world’s top-selling automaker, selling just more than 9 million cars and trucks around the world. The company said Thursday that it sold 9.03 million vehicles last year, up 7.6 percent from 2010. That’s more than 1 million better than Japan’s Toyota Motor Corp., which took the title away from GM in 2008. GM also beat Germany’s fast-growing Volkswagen AG, which last week reported record global sales of 8.16 million in 2011, up 14 percent from the year before. Toyota said it sold 7.9 million vehicles worldwide last year. GM had held the global sales crown for more than seven decades before losing it to Toyota.

Inflation levels off • Consumer prices were unchanged last month, the latest sign that inflation remains tame. Lower gas prices offset rising costs for food, medical care and housing. Excluding volatile food and energy costs, so-called “core” prices rose 0.1 percent, the Labor Department said Thursday. Inflation appears to be peaking after rising steeply last year. Prices rose 3 percent in 2011, up from a 1.5 percent pace in 2010 and the most since 2007. But that’s down from the 12-month increase of 3.9 percent in September.

earnings

Record spending by customers during the holiday season helped lift American Express Co.’s fourth-quarter profit by 12 percent. Amex said it earned $1.19 billion, or $1.01 per share, compared with $1.06 billion, or 88 cents, a year ago. Revenue jumped 7 percent to $7.74 billion.

Bank of America made $2 billion, or 15 cents per share, in the fourth quarter, reversing a $1 Online payday loans.2 billion loss a year ago. It offset legal expenses over mortgages and losses in its investment banking business by selling debt and its stake in a Chinese bank. Revenue rose 11 percent to $25.1 billion.

Capital One Financial Corp. said its fourth-quarter net income fell 41 percent as expenses rose sharply. The company earned $407 million, or 88 cents per share, compared with $697 million, or $1.52, a year ago. Revenue was $4.1 billion.

Google’s moneymaking machine misfired in the fourth quarter. Google Inc. earned $2.7 billion, or $8.22 per share, just a 6 percent increase from $2.5 billion, or $7.81, a year ago. Revenue rose 25 percent to nearly $10.6 billion.

IBM Corp.’s fourth-quarter earnings beat expectations, helped by higher revenue and profit margins in the software and services segments. IBM earned $5.49 billion, or $4.62 per share, up 4 percent from $5.26 billion, or $4.25, a year ago. Revenue grew 2 percent to $29.49 billion.

Intel Corp. said its fourth-quarter profit rose 6 percent. The world’s largest chip-maker earned $3.36 billion, or 64 cents per share, up from $3.18 billion, or 56 cents, a year earlier. Revenue rose 21 percent to $13.9 billion.

Microsoft Corp. battled through a weak PC market to post flat second-quarter earnings. Net income was $6.62 billion, or 78 cents per share, down from $6.63 billion, or a penny, a year ago. Revenue rose 5 percent to $20.89 billion.

Morgan Stanley posted a fourth-quarter loss of $275 million, or 15 cents per share, its first loss since early 2009. The loss compared with earnings of $600 million, or 41 cents, a year earlier. Revenue fell 26 percent to $5.7 billion.

Southwest Airlines’ fourth-quarter net income rose 16 percent. The airline earned $152 million, or 20 cents per share, compared with $131 million, or 18 cents, a year ago. With the addition of AirTran Airways, which Southwest bought last year, revenue rose to $4.11 billion.

Union Pacific Corp.’s fourth-quarter profit jumped 24 percent. The nation’s largest freight railroad operator earned $964 million, or $1.99 per share, up from $775 million, or $1.56, a year ago. Revenue grew 16 percent to $5.1 billion.

UnitedHealth Group Inc.’s fourth-quarter net income jumped 21 percent. The insurer earned $1.26 billion, or $1.17 per share, up from $1.04 billion, or 94 cents, last year. Revenue grew 8 percent to $25.92 billion.

• Find full versions of these stories at stltoday.com/business

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